Progressive Democrats are calling for a ban on all US oil exports, claiming it will lower the price of gas at the pump. Nationalist Republicans are attacking the Biden administration for selling oil from the Strategic Petroleum Reserve on the open market, allowing China to buy millions of barrels.
But new research shows that US oil and gas exports abroad mean more wealth and jobs for Americans back home.
The study, conducted by consulting and communications firm ICF on behalf of the American Petroleum Institute (`I) and the American Exploration and Production Council (AXPC), analyzed the six years since the US crude export ban was lifted in December 2015. The Data showed that allowing exports not only lowered global oil prices by an average of $1.93 per barrel, but also increased US gross domestic product (GDP) by $161 billion and created around 50,000 jobs for the economy.
“American energy leadership not only brings significant benefits to Americans — boosting the US economy and American jobs, providing reliable energy and helping to keep prices down, but it also strengthens global security and supports our allies,” he said `I President and CEO Mike Sommers in a statement. “US energy exports provide critical stability to the global marketplace, support our allies around the world who depend on American energy to meet their needs, and strengthen American energy security here at home.”
Not exporting energy from the United States, Sommers argued, leaves the door open for unstable nations or those with less stringent environmental standards to fill the gap and reap the benefits.
“As this analysis shows, lifting the crude oil export ban in 2015 saved Americans hard cash, supported thousands of well-paying American jobs and reduced our country’s dependence on foreign oil,” said Anne Bradbury, CEO of AXPC. “At a time when Americans are suffering from the price at the pump, it’s clear that increasing the global supply of crude oil is critical to bringing down energy prices here at home and increasing energy security around the world.”
While the news may surprise some people and politicians, organizations like the Institute for Energy Research (IER) say this is exactly what needs to be done.
“In a basic economic sense, increasing the market for a product is likely to result in increased production of that product,” Kenny Stein, IER’s director of policy, told Inside Sources. “Therefore, allowing U.S. oil to be sold to anyone at higher international prices naturally led to increased domestic investment and production.”
Additionally, a key problem with the crude oil export ban was that US Gulf Coast refineries were not designed to refine the types of light oil that were booming because of the hydraulic fracturing revolution (aka “fracking”).
If the light oil cannot be exported and domestic demand is limited, there is little incentive to continue investing in increased production, Stein said.
“The lifting of the export ban allowed domestic production to really take off and made the US a net oil exporter for the first time in more than 50 years,” Stein said. “The lifting of the export ban should always have been viewed as a political hit, with all the ups and downs, and this study shows that clearly.”
Linnea Lueken, a research fellow at the Arthur B. Robinson Center on Climate and Environmental Policy at the Heartland Institute, said the Biden administration’s policies do not hurt or help prices.
“Recent restrictions on domestic oil and gas production, namely moratoria on leasing and similar hostilities, are having the opposite effect,” Lueken said. “The US has the ability to be not only energy independent but also energy dominant.”
Environmental groups don’t like natural gas or LNG exports. Organizations like the Sierra Club have long argued that “natural gas production creates greenhouse gas emissions at every step” before it is ultimately consumed, for example in a power plant.
“Exported natural gas must be liquefied, kept cold, shipped overseas, and then regasified before it can be used,” the Sierra Club wrote in a 2021 report. “All of these extra steps result in CO2 emissions that are up to are 21 percent higher than with conventional natural gas.”
Still, natural gas advocates say the US is the best place to look for these and other fossil fuels.
“Natural gas and LNG exports are particularly important to the US economy,” said Lueken. “If oil and gas production and exploration were allowed to continue as before, and if expanding our export capacity was encouraged by removing unnecessary regulatory hurdles, we could also play a role in helping our European allies cushion the blow from potential export losses.” Russia.”